I'm pretty sure you are on to something, but there is something weird going on.
When I suspend the VM, it already says "macOS 11" in the General tab (I did change it earlier).
After reboot when I get to the login prompt I checked again, still "macOS 11".
When logged in I checked again, still "macOS 11".
I then open the Display preferences, still missing the different resolutions.
Then checking the General tab again, it is back to "Mac OS X 10.16". I tried reboot again and go into the sound preferences instead of display, same thing, switches to "Mac OS X 10.16".
In the .vmx file I find these two lines
guestOS.detailed.data = "bitness='64' buildNumber='19H1519' distroName='Mac OS X' distroVersion='10.15.7' familyName='Darwin' kernelVersion='19.6.0'"
.
.
guestInfo.detailed.data = "architecture='X86' bitness='64' buildNumber='20G730' distroName='Mac OS X' distroVersion='10.16' familyName='Darwin' kernelVersion='20.6.0'"
But nothing about "macOS 11".